Cybercrime taking $600 billion toll on global economy

Technological accomplishments have transformed the criminal economy as dramatically as they have every other portion of our economy, Grobman laments.

Cybercrime is costing businesses close to $600 billion, or 0.8 percent of global GDP, a new report says.

The figure from the 2014 was $445 billion, according to the “Economic Impact of Cybercrime – No Slowing Down,” study by cyber security firm McAfee, carried out with partnership with the Centre for Strategic and International Studies (CSIS).

The report attributes the growth over three years to cybercriminals quickly adopting new technologies, the ease of engaging in cybercrime – including an expanding number of cybercrime centres – and the growing financial sophistication of top-tier cybercriminals.

“The digital world has transformed almost every aspect of our lives, including risk and crime, so that crime is more efficient, less risky, more profitable and has never been easier to execute,” said Steve Grobman, chief technology officer for McAfee.

Grobman cites ransomware, where criminals can outsource much of their work to skilled contractors. “Ransomware-as-a-service cloud providers efficiently scale attacks to target millions of systems, and attacks are automated to require minimal human involvement. Add to these factors cryptocurrencies that ease rapid monetisation, while minimising the risk of arrest, and you must sadly conclude that the $600 billion cybercrime figure reflects the extent to which our technological accomplishments have transformed the criminal economy as dramatically as they have every other portion of our economy.”

Banks remain the favourite target of cybercriminals, and nation states are the most dangerous source of cybercrime, the report finds. Russia, North Korea and Iran are the most active in hacking financial institutions, while China is the most active in cyber espionage.

“Our research bore out the fact that Russia is the leader in cybercrime, reflecting the skill of its hacker community and its disdain for western law enforcement, said James Lewis, senior vice president at CSIS. “North Korea is second in line, as the nation uses cryptocurrency theft to help fund its regime, and we’re now seeing an expanding number of cybercrime centres, including not only North Korea but also Brazil, India and Vietnam.”

Not surprisingly, cybercrime losses are greater in richer countries. However, the countries with the greatest losses (as a percentage of national income) are mid-tier nations that are digitised but not yet fully capable in cybersecurity.